We're thinking of putting a block paving patio at the back of ours shortly. Our front drive is laid with similar, and because we have some big trees with preservation orders on them, we needed to have something that had decent drainage, i.e. no mortar. These have sand brushed between them which is actually really nice, though it needs a quick spray with weed killer every year.

Something like this:

In my personal experience I'd avoid gravel next to grass (although maybe my view is influenced by having kids) because it inevitably ends up on your lawn and then either it pings a rock across the garden which blinds someone or breaks one of your windows. Either way, your mower blade gets a little blunter.
Also cats (not necessarily yours) like to shit in gravel if it's too fine and litter like.

Agree with gibbon about gravel... I'd be tempted to consider decking depending on the circumstances... Obviously upkeep, but I was shocked how hard the groundwork was in laying half a dozen flags. We ended up having to dig out under a tree which was absolutely awful... But in general the soil about 6 inches down became solid raw earth and at least 50% rock.

Bear in mind what your going to do with the earth as well... I'd recommend some back of a fag packet geometry to work out whether a skip is in order... We ended up taking 3 trips to the tip with 10 rubble sacks each time... Not bad for us because it's just up the road... But drags it out.